*Disclaimer: Last updated 12/10/18. Numerous laws and regulations govern your facility. This material is general in nature and is not a substitute for more in-depth study of specific regulatory requirements or organizational best practices. KPA is not providing legal advice and therefore nothing in this material should be construed as legal advice. Qualified legal counsel should be consulted to address facility-specific issues.

Federal Human Resources Laws

IRS – Rollover Notice Update for Retirement Plans

Who: Employers

When: 1/1/2019

What?

When employees who have contributed to a qualified retirement plan leave their jobs, the IRS requires employers to provide the employees with rollover options. The Internal Revenue Service (IRS) has published model notices for this purpose. Employers may also provide a custom notice to employees. Recent IRS changes from the Tax and Jobs Act (TCJA) made updates to the current model IRS Rollover Notice.

How?

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These changes include extending the rollover deadline from the time of distribution to the next tax return following a termination.

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When applying for hardship exceptions for self-certifications, the IRS has provided a 60-day extension and extended deadlines for rollovers from natural disasters.

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The new model notice states that the additional 10% tax under Code §72(t) only applies to amounts included in income and makes a number of other clarifications that apply to government plans.

IRS – Correct Retirement Plan Errors Online

Who: Employers

When: 1/1/2019 – 4/1/2019

What?

The IRS has released updates to its Employee Plans Compliance Resolution System (EPCRS) that now includes an electronic filing component to the Voluntary Correction Program (VCP). Starting in January, the IRS will allow electronic filing and hard copy submission to correct retirement plan errors. By April, only electronic submissions will be accepted.

How?

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Get familiar with new updates and subsequent new IRS processes to correct plan issues.

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VCP submissions will require a pay.gov account where you can electronically file with Form 8950.

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The IRS will issue a tracking number instead of acknowledgment letters and you will need to contact the VCP Status Inquiry Line if you need to modify or supplement information.

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The IRS will provide further instruction as you will no longer be assigned an agent.

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Plan corrections will only be accepted electronically after April 2019.

The IRS has just released its final ruling on the Affordable Care Act (ACA) religious exemption. Employers may be exempt from providing contraceptive coverage due to religious beliefs or non-religious moral beliefs. This rule will take effect 60 days after it’s published in the Federal Register on January 14, 2019. A covered plan sponsor, issuer, or plan will not be penalized for failing to include contraceptive coverage in the plan’s benefits under the final regulations. The law will expand to include certain other individuals and entities based on their religious beliefs or moral convictions as well as employees voluntarily paying for contraceptives through their employer’s insurance.

How?

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This rule doesn’t apply to government institutions that impact health services for low-income women.

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Public companies with nonreligious moral obligations are not exempt insured through grandfather coverage before the ACA.

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Employers that claim an exemption may provide a self-certification or notice to the government, but are not required to do so.

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If an exemption claim is improperly filed, employers can face fines and lawsuits for not complying with the contraceptive mandate.

DOL – Plans to Increase Salary for Overtime Exemption

Who: Employers

When: 1/1/2019

What?

The Department of Labor (DOL) plans to increase the overtime exemption in January 2019. The approximate increase is expected to be considerably less than the ruling in May 2016. The salary threshold for the exemption last increased in 2004 and before that in 1975.

How?

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Plan for any increases in the minimum salary for overtime exemption in your payroll practices.

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Identify executive, administrative, and professional employees who would meet or exceed $30,000 in annual salary wages that currently would be impacted by this ruling.

DOL – Final Rule for Association Health Plans Update

Who: Employers

When: 1/1/2019

What?

The Department of Labor (DOL) defined its final rule for Association Health Plans (AHPs). Small business employers and sole proprietors can band together to offer group healthcare coverage that doesn’t need to comply with Affordable Care Act (ACA) provisions. The final rule includes changes to the rule set on January 1, 2018, like expanding the definition of a “working owner” and requiring a related reason for forming the association other than the AHP.

How?

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Sole proprietors and partners are considered “working owners” and qualify, even if they don’t have any employees. They must receive income from the business or be compensated as an employee to qualify as a “working owner.”

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Previously, AHPs could be formed merely by two businesses forming the association based on the health plan. Now, they have to have an unrelated reason why they created an association.

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If you are considering forming an AHP, seek counsel to navigate fluctuating regulations properly.

IRS – Increased Contribution Limits for Retirement Plans

Who: Employers

When: 1/1/2019

What?

The IRS increased the contribution limit for 2019, so employees can now make annual contributions up to $19,000 for the year with the maximum limit for total contributions from all sources increasing to $56,000. That means that employees have the chance to receive up to $37,000 in matching funds for contributions in 2019. The additional “catch up” limit for contributors age 50 and older will remain at $6,000. The IRA contribution limit will increase from $5,500 to $6,000.

How?

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Adjust payroll systems for the new year.

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Inform employees about the new limits because these changes were announced late in the year. Employers may need to make additions to open enrollment materials. ??

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Notify your employees before year-end through open enrollment materials.

IRS – Updates to ACA Reporting Forms

Who: Employers With 50+ Full-time Employees (1095-C, 1094-C); Self-insured Employees With 50 or Less Full-time Employees (1095-B, 1094-B); Employers That are Members of a Controlled or Affiliated Service Group With 50 Full-time Employees (1095-C, 1094-C)

When: 1/1/2019

What?

The IRS has released forms for 2018 reporting under the Affordable Care Act. Employers will use new forms for 1094-C, 1095-C, 1094-B, and 1095-B in early 2019 to report on group health insurance coverage that they offered employees during the 2018 calendar year.

How?

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Notify employees before year-end through openenrollment materials.

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Applicable employers generally must provide Form 1095-C to all full-time employees by January 31, 2019, and file Form 1094-C and Form 1095-C with the IRS by February 28, 2019 (or March 31, 2019, if filing electronically).

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Self-insured employers with fewer than 50 full-time employees must disperse Form 1095-B to all individuals by January 31, 2019, and file Form 1094-B and Form 1095-B with the IRS by February 28, 2019 (or March 31, 2019, if filing electronically).

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The deadline to distribute 2018 Form 1095-C to employees is extended until March 4, 2019, instead of January 31. The delay also applies to self-insured small employers, insurers and others issuing Form 1095-B to covered individuals.

New Payroll Tax for Higher Incomes

Who: Employers

When: 1/1/2019

What?

Federal Insurance Contributions Act (FICA) are Social Security and Medicare taxes deducted through payroll. In 2019, payroll taxes for FICA will increase for salaries above $128,400 and employees will see a decrease in their net pay.

How?

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Update your payroll system to account for the increased payroll tax in January 2019.

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Notify impacted employees of the new tax and when it will take effect.

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Perform a paycheck audit and check employees’ withholdings according to the new Tax Cuts and Jobs Act (TCJA).

The Department of Labor’s (DOL) Wage and Hour Division (WHD) issued an opinion letter to clarify when professional, executive, or administrative employees paid on an hourly, weekly, or shift basis (subject to a weekly guarantee) are exempt from overtime wages. This rule explains that as long as the workers meet the weekly salary minimum paid on a salary basis, it doesn’t matter if they are paid on hourly, weekly, or shift basis. There must also be a reasonable relationship between the guaranteed amount and the amount actually earned.

How?

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The “reasonable relationship” test will be met if the weekly payment is estimated to be equivalent to the employee’s average earnings at the assigned hourly, daily, or shift basis.

How?

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There’s a 3-year phase-in period, so you’re not required to do anything immediately – although waste vendors may be adopting new fees related to e-Manifests in the future. Nonetheless, most waste vendors are not yet fully supporting e-Manifest.

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Be aware that you may see new waste handling fees from your waste haulers and Treatment Storage or Disposal Facilities.

Federal Environmental Health & Safety Laws

OSHA Site-Specific Targeting Program

Who: Employers

When: 10/16/18

What? OSHA introduced the Site-Specific Targeting Program to target:

•

Employers with the high injury and illness rates.

•

Those with unexpectedly low rates.

•

Those who did not submit data.

They will use injury and illness information that was electronically submitted by employers for calendar year 2016. In addition, they will have a continued focus on workplaces where an employee had an amputation, lost an eye, or died.

How?

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Always be ready for an unexpected OSHA inspection.

OSHA Standards Improvement Project IV

Who: Employers

When: 12/1/18

What?

OSHA proposed to remove from its standards therequirements that employers include employees’Social Security Number (SSN) on exposuremonitoring, medical surveillance, and other recordsto protect employees’ privacy and prevent identityfraud.

The Environmental Protection Agency (EPA), underthe Clean Air Act, is required to review and, ifdeemed appropriate, revise the air quality criteriaand National Ambient Air Quality Standards (NAAQS)every 5 years. On June 22, 2010, the EPA publisheda final rule to revise the primary NAAQS for sulfuroxides to deliver increased protection for publichealth.

How?

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This rule is still in the proposed rulemaking.January 28, 2019, is the deadline for signatureon a final decision notice.

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KPA will keep you updated on the final ruling.

Electronic Waste Manifests

Who: Employers that Generate HazardousWaste

When: 6/30/21

What?

The Environmental Protection Agency launchedthe e-Manifest program for companies thatgenerate hazardous waste. Over time, it’sintended to reduce the costs and burdens oftracking paper manifests from generators totransporters to treatment/disposal facilities.

How?

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There’s a 3-year phase-in period, so you’renot required to do anything immediately -although waste vendors may be adoptingnew fees related to e-Manifests in thefuture. Nonetheless, most waste vendorsare not yet fully supporting e-Manifest.

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Be aware that you may see new wastehandling fees from your waste haulers andtreatment storage or disposal facilities.

The Environmental Protection Agency (EPA) implemented an interim final rule that may eventually change how dealerships, salvage vendors, and others in the auto industry handle Takata airbag inflators as well as other non-Takata airbag components. The EPA’s interim final rule goes into effect once it is published in the Federal Register. The agency will take comments on the rule for 60 days after that.

How?

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No actions are necessary at this time. KPA will keep you posted on the final rule.

Once the airbags arrive at a waste collection facility, they will probably no longer be exempt from the regulations.

OSHA Issues Final Rule on Crane OperatorCertification Requirements

Who: Construction Employers

When: 12/9/18

What?

This final rule, excluding the documentation andevaluation requirements, will become effectiveon December 9, 2018. The evaluation anddocumentation requirements will become effectiveon February 7, 2019.

How?

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Employers are required to train operators toperform assigned crane activities, evaluatethem on OSHA’s criteria, and document thecompletion of those evaluations.

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Employers who have already evaluated craneoperators before December 9, 2018, won’thave to conduct evaluations all over againbut will have to document when those craneevaluations were performed.

On January 13, 2017, the EPA finalized amendmentsto the Accidental Release Prevention Requirementsfor Risk Management Programs (RMPs) under theClean Air Act, Section 112(r)(7). The amendmentsmodify accident prevention program elements,including emergency preparedness and howinformation is shared with the public and localemergency responders.

How?

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On June 9, 2017, the EPA signed a final ruleto delay the effective date of the RMP ruleamendments until February 19, 2019. The EPAwill be conducting a reconsideration proceedingto review objections about the final RMPamendments rule.

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KPA will keep you updated on the effective dateof the final rule.

Federal Sales/Finance & Insurance Law

FTC Fines for Falsifying Credit Information

Who: Employers

When: Always

What?

Earlier this year, the Federal Trade Commission(FTC) filed a legal complaint against a group of autodealerships in Arizona and New Mexico for inflatingcustomers’ income, overstating down paymentamounts, and publishing deceptive ads. It’s a goodreminder to ensure your finance practices are incompliance.

How?

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Be aware that lenders are regularly reportingillegal activity related to false credit applicationsto law enforcement.

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Implement a credit application policy.

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Require customers to complete creditapplications in their own handwriting.

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Always require customers to initial next to theincome statement on their credit application.

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Require finance personnel to give eachcustomer a receipt for any down payment andkeep a copy of the receipt in the deal file.

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Review all advertisements for compliance, priorto publication.

California Minimum Wage Update

Several states and cities are increasing minimum wages. The tables below are updates on the amounts, effective dates,and what rates apply to which size employers.

This new California law is changing what canand cannot be part of legal agreements betweenemployers and other parties. In this case, individualscan’t be banned from disclosing factual informationabout sexual assault, harassment, or discriminationclaims, including retaliation for reporting suchactivity.

Abide by claimants’ requests to have theiridentities shielded and any facts that could leadto discovering their identity withheld from theirsettlement agreement.

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If the case involves a government agency orpublic official, they can’t shield their identities.

SB 826 Gender Equity on Board of Directors

Who: California-based, Publicly Traded Corporations

When: 1/1/2019

What?

By the end of 2019, all California-based, publiclytraded corporations must have at least 1 femaledirector on their board of directors. By 2021, thenumber of women who must be a part of the boardof directors will increase based on the total numberof people serving on the board.

How?

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Ensure that you have at least 1 female directoron your board of directors by the end of 2019.

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By the end of 2021, at least 2 female directorswill be needed if the corporation has 5 directors,and 3 female directors will be needed if thecorporation has 6+ directors.

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Review your board of directors to analyze themembers of your board and determine whatyou need to do to meet the requirements.

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Determine skills or attributes that are neededfrom female directors and plan to meetcompliance requirements by the end of 2019and in 2021.

SB 1300 Sexual Harassment Omnibus Bill

Who: Employers

When: 1/1/2019

What?

This bill amends the California Fair Employmentand Housing Act. In addition to other stipulations,it will be illegal for employers to have employeessign a non-disparagement agreement or anothertype of document that denies employees the rightto disclose information about unlawful acts in theworkplace, including sexual harassment. The legalthreshold will be reduced for harassment suits in2019.

How?

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Employers may be responsible ifnon-employees harass your employees andyou fail to take immediate and appropriateaction. Plaintiffs will not have to prove that theyendured sexual harassment – only that theiremployer was unable to prevent it.

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The standard will be based on whether areasonable person finds that the harassmentaltered working conditions and made it moredifficult for the employee to do his or her job.

□

Review your policies and practices to ensurethat you don’t provide bonuses or raises inexchange for employees’ silence about unlawfulemployment acts.

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Discontinue any non-disclosure or otheragreements that stifle sexual harassmentclaims.

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Employers are encouraged to provide bystanderintervention training for employees to helpidentify problematic situations and take action.

AB 2770 Sexual Harassment DefamationProtections

Who: Employers

When: 1/1/2019

What?

This bill will create new protections for employers,witnesses, and complainants from defamationlawsuits when participating in sexual harassmentclaims and investigations. It will authorize anemployer to answer, without malice, whether theywould rehire an employee and whether or not adecision to not rehire is based on the employer’sdetermination that the former employee engaged insexual harassment.

How?

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Employers have an additional defense againstdefamation claims, but should be cautiouswhen relying on it for litigation purposes.

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Ensure that managers and supervisors taskedwith responding to inquiries are aware of theseadditional protections.

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Discuss with counsel when you should divulgeinformation related to sexual harassment tothird parties.

AB 3082 Sexual Harassment & In-HomeSupport Services

Who: In-Home Support Services Employers

When: 1/1/2019

What?

California’s In-Home Supportive Services (IHSS)program provides assistance for qualified individualswho may be blind, disabled, or elderly so thatthey can remain in their homes. Children who aredisabled and anyone that is 65 or older can qualify.As part of AB 3082, a statewide protocol will beestablished for in-home public heath agents whoencounter harassment.

How?

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Both workers and clients will need to receivetraining.

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raining documents and materials are providedon the IHSS website.

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By September 30, 2019, California’s StateDepartment of Social Services will presenteducational materials and a method to trackresults to the Legislature.

AB 168 Salary History Information

Who: Employers

When: 1/1/2018

What?

Existing law states that employers cannot rely onsalary history in the hiring process when offeringa job or setting a wage for the applicant. The billprohibited employers from paying the oppositegender a different wage if the skills, efforts, andresponsibilities are the same.

How?

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Review your hiring procedures, interviewquestions, and associated procedures to avoidasking applicants about setting their salaryor expectations of what they think their wageshould be. This is to ensure your team is incompliance with current law.

Guidance to Employers to Close the GenderWage Gap

Who: Employers

When: 1/1/2019

What?

The California Pay Act (CFPA) requires that workersmust be paid the same wage for performingsimilar work regardless of sex, gender, or race. TheCalifornia Commission on the Status of Womenand Girls launched the California Pay Equity TaskForce to oversee the CFPA program and recommendmodifications. They have released new guidance foremployers to comply with CFPA.

Under state and federal laws, employers mustaccommodate nursing mothers. San Francisco’sLactation in the Workplace Ordinance went intoeffect on January 1, 2018, but beginning on January1, 2019, employers will face fines for noncompliance.This law specifies details about the lactation roomand requires lactation policies and procedures.

How?

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Employers must provide a clean, comfortable,and private place for mothers to pumpbreastmilk. The room can’t be a bathroom, andit must contain an area to place items, electricityaccess, a sink, and a place to sit.

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The room can be used for other purposes, butlactation takes precedence.

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A refrigerator must also be available to store theexpressed milk. It doesn’t have to be located inthe lactation room.

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San Francisco employers are only exempt fromthese requirements if they demonstrate unduehardship (excessive expense or operationaldifficulty).

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Employers must have a written LactationAccommodation policy. Distribute it to all newemployees and to anyone who inquires about itor requests pregnancy or parental leave.

□

Keep employees’ lactation accommodationrequests for 3 years.

AB 2587 Paid Family Leave

Who: Employers

When: 1/1/2019

What?

The State Disability Insurance Program has a familytemporary disability insurance program known asthe Paid Family Leave Program. Before January 1,2018, an individual was eligible if they could notperform their typical duties for a 7-day waitingperiod to care for a seriously ill family member or tobond with a child.

Existing law states that employers are required togive employees 2 weeks of earned, but unusedvacation (during any 12-month period in which theemployee is eligible for these benefits) and anyleave that doesn’t exceed 1 week be applied tothe waiting period. This bill would delete the 7-dayperiod and any application of vacation leave forthese benefits on and after January 1, 2019.

How?

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Train human resource managers on the newamendments to this law.

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Review your paid family leave policy and ensurethat verbiage is updated to reflect removingthe 7-day period provisions and vacation timeapplied to that period.

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Update your protocol when employees requestpaid family leave to remove the 7-day waitingperiod.

AB 3212 Military Service MemberProtections Extended

Who: Active Military Employees

When: 1/1/2019

What?

AB 3212 expands protections for service members,restricts credit reporting about active duty status,requires written responses to relief requests, andenacts criminal penalties for employers that don’tcomply with these requirements. Plus, it preventsdebt collectors from contacting a service member’smilitary unit for collection and protects servicemembers in court proceedings.

How?

□

Review your policies that relate to militaryservice members and ensure processes andprocedures to handle military service memberrequests are compliant.

AB 1565 Contractor Liability

Who: Employers

When: 9/19/2018

What?

This bill changes aspects of how direct contractorswork with subcontractors.

How?

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Ensure contractors that you bring on board areproperly licensed and insured.

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For contracts drafted after January 1, 2019,direct contractors must spell out whatsubcontractors need to produce before thedirect contractors can withhold disputedpayments from the subcontractors.

AB 1373 Group Life Insurance

Who: Employers

When: 1/1/2019

What?

Group life insurance is given in the form of acertificate that states the coverage of insurance, anextension of insurance, and death benefits. With thisamendment comes restrictions around the currentlaw, such as an insurance policy not being given toless than 2 employees and being written under theissue of the employer who pays a premium. Theamendment also covers who can be designatedas a fiduciary or trustee and who’s considered anemployee. Employees can now be eligible throughaffiliated firms to qualify for group life insurance.

How?

□

Review your group life insurance policies andensure they comply with new amendmentregulations.

SB 1375 Health Insurance: Small EmployerGroups

Who: Employers

When: 1/1/2019

What?

California has responded to recent legislationthat allows small business owners, independentcontractors, and sole proprietors to join togetherto form an association health plan (AHP) not heldto the same regulations as the Affordable Care Act.With this bill, California removes sole proprietorsfrom the list of eligible parties for AHPs.

How?

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If you are a sole proprietor and operating in thestate of California, you’ll have to continue to getinsurance privately or through the marketplaceduring open enrollment.

SB 1428 Minors’ Work Permits

Who: Employers

When: 1/1/2019

What?

SB 1428 allows minors to apply for work permitsregardless of grade point average or attendanceif the permit is for a government-administeredemployment and training program. This permitis authorized for the summer recess or schoolvacation.

How?

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Currently, educational officers, likesuperintendents, county superintendents,or charter school chiefs, can authorize workpermits for minors, among others.

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If you authorize work permits for minors, ensurethat your hiring managers understand how tocomply with this rule and do not take gradepoint average or attendance into considerationwhen authorizing work permits for governmentagencies.

SB 1412 Criminal History

Who: Employers

When: 1/1/2019

What?

SB 1412 will specify how employers may usejob applicants’ expunged or judicially-sealedconvictions. It requires employers only to consider“particular convictions” that are relevant to the jobwhen they’re screening applicants.

How?

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Take care not to receive nor consider convictioninformation beyond what’s relevant for the role.

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Do not ask applicants about their criminalhistory until after you have given them aconditional job offer.

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Train hiring managers to only considerconvictions that are relevant to the jobapplicants are applying for.

SB 954 Encouraging MediationConfidentiality

Who: Employers

When: 1/1/2019

What?

SB 954 requires printed disclosures to be distributedto employees participating in mediation concerningconfidentiality. Attorneys working on employmentrelatedmediation cases will need to inform clientsabout confidentiality limitations and obtain theirclients’ written consent.

How?

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This information should be presented BEFOREan individual agrees to mediation.

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When using an attorney for employmentmediation matters, make sure they informinvolved parties that anything said duringmediation isn’t admissible evidence or subjectto discovery. All communications, negotiations,and settlement discussions betweenparticipants or mediators are confidential,except as specified.

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Verify this language is included in agreementsand signed before starting mediation.

AB 3109 Banning Non-Disclosures AboutSexual Harassment

Who: Employers

When: 1/1/2019

What?

AB 3109 protects victims of sexual harassment fromnon-disclosure agreements that require them tomaintain confidentiality on behalf of employers.Agreements and waivers that prevent victimsfrom testifying or disclosing criminal conduct areprohibited in the workplace.

How?

□

Review your contracts and settlementagreements and ensure they comply with thislaw starting in 2019.

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Don’t draft contracts after January 1, 2019,that allow employees to waive their right totestify in alleged criminal or sexual harassmentproceedings.

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If an employee or contractor has been issued acourt order, subpoena, or written request froman administrative agency or state legislature,they must testify.

Currently employers with 50+ employees must givesexual harassment training to supervisors. By 2020,employers with 5+ employees must provide sexualharassment training to supervisory, non-supervisory,temporary, and seasonal employees.

How?

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Through the Department of Fair Employmentand Housing sample online training courses areavailable for employers to use or employers cancreate their own per California law.

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Employers must provide 2 hours of sexualharassment training to all supervisor employeeswithin 6 months of starting their position.

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Employers must provide 1 hour of sexualharassment training to all non-supervisoremployees within 6 months of starting theirposition.

AB 168 amends this salary history law and clarifiesCalifornia’s Equal Pay Act in 3 ways:

1.

Reasonable requests for applicants and payscales.

2.

Employers can get applicants’ salaryexpectations for the job they’re applying for.

3.

Guidelines for emloyers on how to makedecisions on current employees’ compensation.It will authorize California employers to consideran employee’s current salary when setting his/her compensation as long as any resulting wagedifferences across the organization are justifiedby at least one legitimate, non-monetary factor,such as a seniority system or a merit system.

How?

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Update any hiring polices to reflect theclarification on salary history.

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Train managers and supervisors on how tocomply with this law when initiating promotionsor pay wages or hiring applicants.

Train human resources and your payrolldepartment to be informed of the new protocolfor compensation changes.

AB 1976 Lactation Accommodations

Who: Employers

When: 1/1/2019

What?

The bill requires every employer to make areasonable effort to provide accommodation tomothers who need to express breast milk in aprivate space that isn’t a bathroom stall. The bill isamended to include temporary lactation spaces ifthe employer can’t provide a permanent space dueto operational, financial, or space limitations.

How?

□

Review your lactation accommodation policiesfor compliance.

□

Convert a room or office into a pleasant andprivate space for new mothers to express milk.

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If you are using a temporary space, it must beprivate and free from intrusion while expressingbreastmilk. Use the location only for thispurpose during the time the employee needsit, and it must meet California law requirementsfor lactation accommodations.

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Employer exemptions are allowed if you candemonstrate that providing a lactation spacewould cause undue hardship when consideringyour business’s size, structure, and type ofbusiness.

SB 1252 Pay Statements

Who: Employers

When: 1/1/2019

What?

This bill amends California’s Labor Code, Section226. As such, employees will be able to request acopy of their pay statements.

How?

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Give employees or former employees a hardcopy of their wage records if requested.

□

Ensure that you are following properpayroll practices and audit your wages forinconsistencies.

Currently, eligible employees can take up to 6 weeksof paid family leave to care for a seriously ill child,spouse, parent, grandchild, sibling, or registereddomestic partner, or to bond with a new child dueto birth, adoption, or foster care placement. SB1123 will expand the Family Temporary DisabilityInsurance Program to include time off to attend toa “qualifying exigency” related to an individual’sspouse, registered domestic partner, parent, or childwho is an active duty member of the U.S. ArmedForces.

How?

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A qualifying exigency includes any issues thatarise from an order or deployment, an officialmilitary event, ceremony, program, counseling,parental care, arranging alternative childcare, orfinancial and legal arrangements.

□

Employees approved for leave will receive 60-70% of their wages.

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Employers have until January 1, 2021, to complywith this law. In the meantime, employees areself-funding it.

AB 2605 Rest Breaks – Petroleum Facilities:Safety-Sensitive Positions

Who: Oil & Gas Industry Employers with UnionizedEmployees

When: 9/20/2018 – 1/21/2021

What?

AB 2605 makes employees with safety-sensitivepositions at a petroleum facility exempt to the mealand rest break provisions. However, when workersare forced to miss a break, the employer must paythem 1 additional hour of compensation at theemployee’s regular rate of pay. This law will be ineffect until January 21, 2021.

How?

□

If you are in the petroleum industry, monitorsafety-sensitive positions for meal and restbreaks.

□

If an employee is unable to take a break, youmust pay them 1 additional hour at his/herregular rate of pay.

□

Come up with proper notification and payrollprocess to adequately compensatesafety-sensitive positions for missed meals orrest breaks.

AB 2610 Meal Periods for CertainCommercial Drivers

Who: Employers

When: 1/1/2019

What?

This bill will authorize commercial drivers who areemployed by a motor carrier and transport itemsfrom licensed commercial feed manufacturers tocustomers located in remote, rural locations to takea meal period after 6 hours of work. This is providedthat the driver’s regular rate of pay is no less than 1and 1/2 times the state minimum wage and the driverreceives overtime compensation in accordance withspecific provisions of existing law.

How?

□

Develop a system to track meal periods for commercialdrivers who drive more than 6 hours.

□

Ensure that all commercial drivers are informedof this policy and know how to comply with it.

□

The meal break period must begin no later thanthe end of an employee’s fifth hour of work.

□

A second meal period is due after 10 hoursworked in a single day.

□

Employees are ordinarily required to be relievedof all duty during their meal periods.

□

It is not mandatory that employers pay foremployees meal periods. Employees shouldclock in and out for meal periods, or note thestart and end time for meal periods on theirtime sheets.

AB 235 Apprenticeship &Pre-apprenticeship

Who: Employers

When: 1/1/2019

What?

AB 235 expands opportunity for new workersby investing in apprenticeship programs andregulations in California. The bill revises theCalifornia Apprenticeship Council to include moremembers establishing partnerships betweenagencies like firefighters and construction trades.Apprenticeship programs are also a way for womenand people of color to gain access to employmentand for the state to address discrimination in theworkplace. Emerging industries for apprenticeshipprograms are advanced manufacturing, healthcare,and IT.

How?

□

By January 1, 2019, the council is required toestablish a pre-apprenticeship program toverify eligibility for any state programs, such asdefining specific elements and how they can bemeasured.

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Watch for standards on a state-recognizedapprenticeship program including certificates,on-the-job training, and classroom study.

SB 970 Human Trafficking Awareness

Who: Hospitality Employers with 50+ Employees

When: 1/1/2019

What?

As an amendment to California’s Fair Employment& Housing Act, hospitality employers will need toprovide the required training to employees likely tocome into contact with human trafficking victimsor modern-day slaves. Examples of employees whowould take this training include those who work inreception, housekeeping, valet, or room service.

Provide training to part-time and full-timeemployees who are on your payroll as ofJuly 1, 2019, and beyond. Use professional,classroom-style or interactive training.

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Your training should cover set topics, includingthe definition of human trafficking and thecommercial exploitation of children as well asreporting responsibilities.

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New hires must complete this training within6 months of their start date and every 2 yearsthereafter.

AB 2705 Violations for Contractors

Who: Employers

When: 1/1/2019

What?

Existing worker’s compensation laws requireemployers to compensate for work-relatedaccidents. The Contractor’s State Licensure Lawrequires contractors to hold Certificates of Workers’Compensation Insurance or Certificate of Self-Insurance. Violations result in a misdemeanor and,additionally, this bill makes it a misdemeanor fornot paying workers’ compensation for contractorslicensed under California law.

How?

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Determine if you are working with any licensedcontractors and ensure there’s a process set upfor contractors to report a work-related injury orillness.

SB 1402 Port Drayage Motor Carriers

Who: Employers

When: 1/1/2019

What?

California’s Los Angeles and Long Beach ports arethe two busiest ports in the U.S. Under SB 1402,retailers and port trucking companies’ customerswill have increased liability.

If your organization contracts with a blacklistedcompany, you’ll share all civil, legal, andliability responsibility owed to drivers for theirservices. This means you are responsible forthe full amount of unpaid wages, unreimbursedexpenses, damages, and penalties.

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Port trucking companies will need to givetheir customers a copy of any unsatisfied finaljudgments. If you don’t receive this notice, you’dbe absolved of your liability.

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Develop protocols to monitor the DLSE’sblacklist.

California Environmental Health & Safety Laws

SB 1167 Indoor Heat Illness Prevention Program

Who: Employers

When: Pending

What?

Indoor Heat Illness and Injury Prevention Program may be required at indoor places of employment.

How?

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There are no immediate actions to take. If the law passes, KPA will create a written program to help clients comply with this requirement.

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By January 1, 2019, the division will propose their review of the standards to the board and adopt practices that minimize heat-related illness and injury among workers working in indoor places of employment.

AB 2535 Notice of High-Occupancy TollEvasion Violations

Who: Employers with Fleet Vehicles

When: 1/1/2019

What?

Under existing law, within 21 days of a toll evasionviolation, an issuing or processing agency forwardsa notice to the registered owner of the vehicle thatevaded the tolls. This bill will add photographicevidence to the notice if drivers don’t meet thepassenger requirements of a high-occupancy tolllane.

How?

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If your employees drive for your business,remind them about your toll/driving policiesand the consequences of intentional violations.

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If auto dealers don’t properly submit trade-invehicle paperwork, they may receivehigh-occupancy toll road violations that willneed to be contested.

AB 2832 Lithium-ion Battery Recycling

Who: Employers

When: 04/1/19

What?

Requires the California Environmental ProtectionAgency (CalEPA), on or before April, 1, 2019, toconvene a Lithium-ion Car Battery RecyclingAdvisory Group to present to the legislature withpolicies for recycling lithium-ion batteries sold withvehicles in the state.

How?

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There are no immediate actions for employersto take. The Energy Commission (EC) will assess,and KPA will keep you up-to-date.

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Monitor lithium-ion battery recycling as itrelates to the push for zero-emission vehicles inCalifornia.

Cal/OSHA can cite employers for injury and illnessrecordkeeping violations.

How?

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If you had 250+ employees at any one locationat any point in 2018, you need to electronicallyfile your 2017 Cal/OSHA 300A form by the endof 2018. Submit 2018 information by March 2,2019.

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If you had 20-249 employees at any pointin 2018 AND you’re in one of 66 qualifyingindustries, you need to electronically file. Note:Auto dealerships with 20-249 employees do nothave to electronically file.

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All employers, regardless of employee size,must report to federal OSHA within thedesignated timeframes whenever a workplaceincident results in an employee’s inpatienthospitalization, amputation, loss of an eye, ordeath.

AB 1980 & AB 2902 Petroleum Storage Tanks

Who: Employers with Above-ground PetroleumStorage

When: 1/1/2019

What?

AB 1980 and AB 2902 Petroleum Storage Tanks arebills that extend the statute of limitations for civilenforcement of above-ground petroleum storage actviolations from 1 year to 5 years.

How?

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Work with legal counsel or an environmentalhealth and safety specialist to implementchanges to your petroleum tanks.

California Sales/Finance & Insurance Laws

AB 375/SB 1121 California Consumer PrivacyAct of 2018

Who: Businesses that (a) Have a $25+ millionannual revenue, or (b) Annually handle personalinformation from 50,000+ consumers, households,or devices, or (c) Derive 50+% of their annualrevenue from selling consumers’ personalinformation.

When: 1/1/2020

What?

The California Consumer Privacy Act (CCPA) will giveconsumers the right to:

1.

Know the categories and specific piecesof personal information the business hascollected, where it was sourced from, what it isbeing used for, and who it’s shared with or soldto;

2.

Require a business to delete consumers’personal information (with some exceptions)that the business has collected from theconsumer;

3.

“Opt out” of letting a business sell their personalinformation to third parties; and

4.

Receive equal services and pricing, even if theyexercise privacy rights under the Act.

How?

Since the CCPA will not go into effect until January1, 2020, the law may be amended. If that’s the case,KPA will provide updates. Depending on the finalversion of the law, it may be necessary to:

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Update your website’s privacy statement.

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Update your privacy notice.

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Update confidentiality agreements with yourvendors.

AB 2392 Towing & Storage

Who: Companies that Tow or Store Vehicles, RepairFacilities, Dealerships with Service Departments

When: 1/1/2019

What?

Requires towing and storage fees to be reasonablecompared to other facilities in the area and prohibitscertain types of fees. This bill also changes theinformation required to be included in the TowingFees and Access Notice, and exempts new vehicledealers from having to provide the notice.

Automotive repair dealers that don’t engage intowing, but charge for storage, are exempt fromposting a “Towing and Storage Fees and AccessNotice” sign, but they must still provide thenotice if a consumer requests it.

Existing law authorizes a business to use anelectronic device to swipe a driver’s license oridentification card (ID) for certain prescribedverification and informational purposes. The lawhas been amended to apply equally to scans.

How?

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Permissible purposes for scanning or swiping alicense or ID card will include:

1.

To verify age or the authenticity of thedriver’s license or ID card, and

2.

To collect personal information that isrequired for preventing fraud.

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A driver’s license or ID card may not bescanned/swiped for marketing purposes.

AB 2330 Recreational Vehicle DealersTemporary Branch Licenses

Who: RV Dealers

When: 9/19/2018

What?

Existing law grants recreational vehicle (RV) dealerstemporary branch licenses to sell new RVs at tradeshows. To qualify for this temporary license, dealersmust submit specific documentation to the DMV,such as the manufacturer’s written authorization.Additional requirements are imposed if there are 9or fewer RV dealers participating in the show or ifthere are 10+ RV dealers. RV dealers were exemptfrom temporary branch license requirements if theshow was sponsored by a national trade associationof RV manufacturers and the show is located in acounty with 6+ million people.

This bill changes the exemptions to increase thepopulation to 9+ million, include any new tradeshow location within 30 miles of a previouslyapproved location, and at least 10 RV manufacturersare participating.

Who: Those Who Register Vehicles or Use/RequestDriver’s License Information

When: 09/19/18

What?

When requested, the Vehicle Code authorizes homeaddress confidentiality for certain current or formergovernment employees, their spouses, and childrenon any vehicle, driver license, or identification cardfor DMV records reflecting the person’s name. Thenew law clarifies that both active and retired judgesand court commissioners will also be eligible forconfidentiality. Also, a surviving spouse or child of ajudge or court commissioner is eligible if the judgeor court commissioner died in the performance ofhis or her duties.

How?

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If a customer requests confidential vehicleregistration, confirm the customer’s eligibility.

If the customer is applying for credit, followyour Red Flags program for guidance relating tocustomer addresses.

AB 3163 DMV Private Industry Partners& Electronic Document Submission

Who: Automotive Dealers

When: 9/14/2018

What?

On September 14, 2018, Governor Brown signed intolaw AB 3163. The law was passed with an “urgencyclause” and became effective immediately. Thelaw permits dealers to pass on to consumers anelectronic vehicle registration or transfer chargeof up to $30 (increased from $29) or the amountcharged to the dealer by the first line serviceprovider, whichever is LESS (Vehicle Code §4456.5(a)(2).

How?

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Reprogram your DMS to charge $30 or theamount charged by your first line service provider.

AB 516 Temporary License Plates

Who: Vehicle Dealers

When: 1/1/2019

What?

Dealers will be required to electronically report new,used, and wholesale vehicle sales to California’sDMV. The Document Processing Charge will increaseby $5. If you’re an official private industry partnerwith the DMV, the Document Processing Charge willbe $85. If not, the Document Processing Charge willbe $70.

How?

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Before delivering a sold/leased passengervehicle, truck, or motorhome to a customer,the dealer must print and attach temporarylicense plates (TLPs) to the front and backof the vehicle. In the case of a motorcycle,trailer, or coach, one temporary plate must beaffixed. Once the permanent plate(s) arrive, thecustomer must replace and destroy the TLPs.

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Update your existing DMS with the newDocument Processing Charge.

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Only use a laser printer and specialnon-destructive paper to produce TLPs.

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Order the non-destructive paper from your FirstLine Service Provider or DMV reporting systemvendor.

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Dealers should NOT affix dealershipadvertisement placards to the vehicle in lieu oftemporary license plates.

AB 544 Expiration Dates of CAV Decals

Who: Automotive Dealers & Drivers

When: 01/01/2019

What?

Certain Clean Air Vehicle (CAV) decals will expire,other ones won’t, and new ones will be issued.CAV decals are reserved for eligible vehicles ofcertain makes and models.

Green and white decals issued before January 1,2017 will expire on January 1, 2019. Green and whitedecals issued between January 1, 2017 and March1, 2018 will be valid until January 1, 2019. However,owners can apply to the DMV for a red decal, whichis valid until January 1, 2022.

Red decals were issued after March 1, 2018 and willbe valid until January 1, 2022.

Owners applying for a new CAV decal after January1, 2019 will receive a purple decal. Purple decals willbe valid until January 1 of the fourth year after theyear of issuance.

How?

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Train sales staff regarding:

1.

The expiration dates of specific CAV decals,and

2.

Which vehicles with green or white decalsmay be eligible for replacement red decals.

AB 1274 Model Year Smog Check Exemption

Who: Automotive Dealers & Vehicle Owners

When: 1/1/2019

What?

The biennial smog certification exemption isextended to vehicles that are 8 or less model yearsold. A new $25 smog abatement fee will be appliedto those 2 additional years, but will remain at $20 forthe 1st year through the 6th year. For example, if adealership sells a 2012 vehicle in 2019, a $25 smogabatement fee will apply because it will in its 7thyear.

How?

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Check your used vehicle inventory to see if anyvehicles fall within this 8 model-year exception.

AB 2521/3212 Service Member Protections

Who: Automotive Dealers, Lenders, Debt Collectors& Service Members

When: 1/1/2019

What?

AB 2521, the California Military Families FinancialRelief Act, allows reservists called to active dutyto defer payments on retail installment contracts,leases, and other agreements for the period of activeduty + 60 calendar days, or 180 days, whichever isless. To obtain a deferral, the reservist must senda written request along with a copy the reservists’activation or deployment order. Under AB 2521, thewritten request doesn’t have to be signed.

AB 3212 adds various protections for servicemembers and/or reservists called to active duty andimposes new restrictions on creditors who attemptto collect from them. Among other things, the bill:

1.

Authorizes a service member to terminate avehicle lease under certain circumstances,

2.

Prohibits a creditor from contacting a servicemember’s military unit or chain of commandwithout the written consent of the servicemember, and

3.

Allows for postponement of court actionsagainst service members for up to 120 days(instead of 60 days) after the period of militaryservice.

How?

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Prior to collecting money from a servicemember or reservist, review all relevant lawspertaining to their obligations.

This bill fundamentally changes the definitionand functions of an Automotive Repair Dealer(ARD). Traditionally, an ARD is any person or facilitythat repairs motor vehicles. However, there arecertain kinds of services that were exempt fromthis definition. This bill creates a “preventativemaintenance services” category, which includes theformerly exempted services, and allows for ARDsto perform these functions. Repair facilities thatwere once excluded from the Bureau of AutomotiveRepair’s (BAR) oversight must now register as an ARDand conduct their business in accordance with theAutomotive Repair Act.

How?

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More repair facilities will need to register with the BAR. Dealers can now operate an “express lane” that bypasses the estimate requirement so long as they perform preventative maintenance services within certain parameters.

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You don’t have to provide a written estimate for services that only involve “preventative maintenance services” if the customer authorizes the repair service and either of the following occurs:

1.

The service is free, or

2.

The total price for labor and parts isconspicuously displayed or is made availableto the customer where the service isperformed.

SB 179 Gender Identity on Driver’s Licenses

Who: Employers

When: 1/1/2019

What?

Applicants for driver’s licenses can now choose from3 gender categories when declaring their sex: male,female, or nonbinary.

How?

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Please be aware that these types of driver’slicenses are now in circulation.

Electronic Documentation & Authorization

Who: Service Departments & Repair Facilities

When: 09/13/2018

What?

The Bureau of Automotive Repair’s (BAR) madeupdates to the Automotive Repair Act and tookeffect immediately in September 2018. The newregulations state the following:

This bill amends the Rosenthal Fair Debt CollectionPractices Act. It will prohibit a debt collector fromsending a written communication to a debtor inan attempt to collect a time-barred debt unlessthey provide specified written notices stating thatthe debtor may not be sued for the debt and thatthe debt, depending on its age, may be reportedas unpaid to credit reporting agencies. The billalso prohibits a collector from commencing a suit,arbitration, or other legal proceeding to collecta debt for breach of contract after the statute oflimitations has run out.

Dealers that sell new motorcycles must attachto the motorcycle’s handlebar a manufacturer’shang tag label that includes specified information.This new law will require the hang tag to includethe manufacturer’s suggested retail price and themotorcycle’s vehicle identification number, inaddition to the information that was previouslyrequired.

Also, if a dealer chooses to post a supplementallabel that causes the dealer’s asking price toexceed the manufacturer’s MSRP, the label mustcomply with a specific format, content and displayrequirements.

This bill allows owners of expired Clean Air Vehicle(CAV) decals to renew their decals between January1, 2020 and January 1, 2024. These reneweddecals will expire on January 1, 2024. In an effort topromote decals among middle income drivers andthe use of newer eligible vehicles, the legislatureplaced limitations on this program.

First, these decals will only be issued to owners whohave a household income at or below 80% of thestate median income. Secondly, the person applyingfor the renewed CAV decal cannot be the party tohave been originally issued the expired decal. Last,a renewed CAV decal will not be issued for any decalthat was originally issued prior to January 1, 2017.

How?

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If you drive an eligible vehicle and are incomequalified, apply for a CAV decal using the REG100 form.

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Train your sales staff about CAV expiration datesand income-based restrictions for renewingdecals if you sell eligible vehicles or have CAVdecals affixed to vehicles in your inventory.

AB 2620 Rental Passenger VehicleTransactions

Who: Businesses That Rent Vehicles

When: 1/1/2019

What?

This bill will permit rental companies to useelectronic surveillance technology if a rental vehiclehasn’t been returned within 72 hours after theagreed upon return date. (Existing law generallyrequires rental companies to wait 1 week.) The rentalcompany must notify the renter by telephone andelectronically, at least 24 hours prior to activatingelectronic surveillance technology. The rentalcompany must also advise the renter both verballyand in writing (acknowledged by the renter’s initials)that electronic surveillance technology may beactivated if the rental vehicle isn’t returned.

How?

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Update your rental agreement to allow foractivation of electronic surveillance technologyif a vehicle isn’t returned within 72 hours of theagreed upon return date.

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Train employees (1) To verbally disclose thatelectronic surveillance technology may beactivated if the rental vehicle is not returnedwithin 72 hours after the agreed upon returndate, and (2) To comply with the 24-hournotification requirement.

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Arrange to send communications to arenter electronically (by a means other thana cell phone) if the renter agrees to thatcommunication in the rental agreement. Youcan’t deny a rental agreement if the renter optsout of electronic communications.